Rivers Governor Wike Commences Implementation of VAT Law

Governor of Rivers State in Nigeria’s Niger Delta, Nyesom Wike, has raised the alarm over underhand moves by the federal government to move the appeal it had filed on the VAT matter from the Court of Appeal in Port Harcourt to the appeal court in Abuja, where the government hoped it could mount pressure on the appellate court to win a stay of execution of the judgement.

The governor, who disclosed this to THISDAY, said he was informed of the development while attending a Peoples Democratic Party (PDP) meeting in Abuja, on Wednesday.

Wike stated, “I was told the FIRS is working to move the appeal to Abuja, but I have not confirmed whether it is true or not. But let it be known that I am standing on the principle of justice and constitutionalism. What I feel is that the right thing should be done. Whether they want to hear it in Kafanchan or America, let the law take its course.

“Today, it is my turn, it can be another person’s turn tomorrow. I believe the right thing must be done at the right time. This country must move forward and justice must be done. This is an issue of constitutionalism.”

THISDAY also learnt on Wednesday that the governments of Lagos and Ekiti states had concluded plans to file applications to be joined in the on-going legal battle between the FIRS and Rivers.

But in spite of the controversy the VAT issue has generated, Rivers State, yesterday, said it had commenced full implementation of its VAT Law. Wike made this known yesterday during an interactive session with representatives of corporate organisations in Port Harcourt.

Wike said the enforcement would prevent members of the business community from falling prey to the antics that could be deployed by FIRS officials, whom he said could attempt to use force to collect “what does not belong to them.”

Wike alleged that FIRS had in the past collected VAT in the state with impunity, knowing it was unconstitutional for them to do so. He pointed out that his administration challenged the matter at a Federal High Court in Port Harcourt, where it secured a positive judgement on the matter.

The governor said, “When we challenged the federal government, through the Office of the Attorney-General, and FIRS in court, do you know what they did? They wrote a letter dated July 1, 2021. Remember, it was in 2020 that we filed this action against them. But see how corrupt this country is.

“Corruption is not only about kickbacks, it is also about doing something illegally. We were in court in 2020. Then on July 1, 2021, the chairman of FIRS wrote to the National Assembly through the office of the Deputy Speaker of the House of Representatives.

“He was asking them to amend the constitution and insert VAT under item 58 of the Exclusive Legislative List, when we were already challenging that it is not their responsibility to collect VAT. They knew that what they were doing was not the right thing.”

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He described as unfortunate the allegation that the FIRS had resorted to writing threat letters to intimidate corporate organisation to pay VAT to the federal agency even after they had lost an appeal that sought a stay-of-execution of the declarative ruling on VAT collection in the state.

Wike urged business operators to be ready to pay VAT for the month of September 2021 and subsequent months to the Rivers State Internal Revenue Service. He said he had already assented to the Rivers State VAT law passed by the State House of Assembly.

The governor warned corporate organisations not to feign ignorance of the state VAT law and declared that the government would not hesitate to seal up the premises of any company that defaulted.

“We are going to inaugurate the Tax Appeal Commission by Friday, which will be headed by a retired judge of the state,” Wike hinted, calling the disparity in VAT proceeds and what is given to the states as an inexplicable form of injustice that weakened the performance potential of the states.

He explained, “Let me tell you the injustice in this country. In the month of June 2021, which we shared in July, VAT collected in Rivers State was N15.1billion. What they gave us was N4.7 billion. See the gross injustice, and the money includes contracts awarded by the Rivers State Government.

“This is not an issue of party, it is the issue of infraction of the constitution, issues of illegality. Look at Lagos, it is not the same party with me. In the month of June 2021, the VAT collected in Lagos was N46.4 billion but see what Lagos got – N9.3 billion.

“Have you seen the injustice in the country? VAT collected in Kano was N2. 8 billion and they gave them N2. 8billion. Is there justice in this country?”

Wike described as morally offensive a situation where Rivers State government would award contracts for state roads worth N200 billion and the FIRS would allegedly receive 7.5 per cent of the amount as VAT to be distributed among the states.

“So, you allow me to call the big companies, award contracts to them, then you, FIRS, come and collect the tax and then go and distribute it to other states, who are not awarding contracts. How does it sound,” he asked.

The governor said nobody had been courageous enough to challenge the alleged illegality perpetrated by the FIRS, saying history would be kind to Rivers State to have mustered the courage to speak out and also challenge it.

“I overheard the FIRS chairman saying I’ll soon know the power of the federal government,” Wike stated. He added, “And that they’ll show me that they have the power to muzzle the judiciary. You can muzzle them as you want. Let the Court of Appeal and Supreme Court interpret the law so that all of us will go and rest.

“Use all the power you want to use, but history will be written one day and those who will allow themselves to be used to muzzle and misinterpret the law will face God one day.”



James Emejo in Abuja and Blessing Ibunge in Port Harcourt

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